Every time the launching of exclusive articles and with a limited distance is more in fashion. Quality, exclusive feature and mainly tendency is what nowadays numerous marks of clothes are following. Elizalde and Riaño approach in the daily Expansion a clear example of this new fashion of Zara.
In just released Zara store in the Fifth Avenue in New York, there is an article that emphasizes of the rest and that it does not happen unnoticed: a shelter of thousand dollars. Anyone is not an article, is a fur coat returned and also covered in skin, that in Madrid is mission impossible to find, except for counted exceptions, like in the establishment in the new terminal of Barajas (Madrid).
This article corresponds to a series limited, of which Inditex sends sporadically, according to explains one of the employees of the Zara store in Vestibule of the Angel, in Barcelona. This establishment, located in the commercial street more face of the city and second of Spain, has been the unique one of the Condal City that has received the shelter, made in Spain, as it says his label. Two of them were reserved by a same woman and the other continued on sale in the middle of December. In the Spanish market, as soon as these shelters have been put on sale. Sources near the company assure that the majority of articles has not gotten to leave Arteixo, the headquarters of Inditex in Corunna, since it has been reserved by “faithful clients” or “collectors of clothes”.
Strategy
Paradoxicalally, it is easier to find the fur coat in New York, Beijing or Rome that in Madrid or Barcelona. Nevertheless, if one goes deep in the commercial strategy of Zara and its presence in the outside, this situation is understood far better. Ever since Zara embarked in the conquest of the world, with his first store in Oporto (Portugal) abierta in 1988, which it followed a year one second in New York later, the chain has maintained an unstoppable race of openings. Like result, the 80 percent of their invoicing comes today from the international stores.
In the outside, the group counts on a good number of emblematic stores, that mark the beginning of their incursion in the new market. Thus, although the group bets by a quality product formula and design to attractive prices, the reality is that outside Spain a more expensive mark is perceived as one more.
For the chain, the explanation is that in the domestic markets (Spain and Portugal), the consumer has a greater knowledge of the mark he perceives and it as an average standard, while in the outside “a more objective perception is had one more”. According to the analysts, in the markets internments, the image of Zara moves away of its fashionable motto to reasonable prices.
Which is the criterion that follows the chain to fix the prices to the outside? In the beginning of its international adventure, Zara applied in each country a different price. In 2003, it decided to harmonize the tariffs by geographic areas and thus one stays at present.
Sources of the group stress that the element fundamental to fix the prices is of commercial nature. In this sense, it influences the type of public to whom one goes in each market. For example, in the European countries, more of the 95 percent of the population she is potential client of Zara, you lie that, in Russia or Mexico, their possible consumers are reduced to a niche of population with elevated spending power.
By countries
This way, the prices in the area Euro are placed of average a 25 percent superficially to the fixed ones to Spain. The exception is Greece, where they are only a 10 percent more expensive than in the Spanish market. In the product sample selected by the daily Expansion in the different countries, it is reflected that, in Italy the average cost of articles is a 30 percent superior, although in some cases surpasses the 40 percent. While, the strategy of the chain is to lift the prices of average a 35 percent with respect to Spain in the United Kingdom and the countries of the north of Europe. Nevertheless, the depreciation of the pound, whose change approaches the parity with the Euro, is handicapped to little more of the 10 percent the difference of cost between Madrid and London.
Something similar happens in the United States, where the policy that follows Inditex is to locate the tariffs a 45 percent over the Spanish market. At present, due to the depreciation of the dollar against the Euro, this percentage has been reduced to little more of the 30 percent. “In the mid term, the tendency is not to generate repercussions direct of the type of change”, explain.
In Latin America, the prices are between a 30 percent and a 40 percent more expensive than in Spain, although there are variations by countries. In Mexico, where Zara has an important presence, they are a 25 percent superior to Spain. In the Asian countries, the differences of cost with respect to Spain oscillate between the 40 percent and the 50 percent. The market where the articles of Zara are sold more faces is in Japan, country in which it is possible to be gotten to duplicate the price.
Spain, more cheap
Without a doubt, the country in which more cheap turns out to buy in Zara is Spain. For the experts, the Spanish market is generally, after Andorra, the most reasonable country to buy clothes.
The adaptation of the prices in the different countries also responds to the necessity to obtain the yield of the stores. The principle of Inditex is that all the establishments make money. On the other hand, sources of the Catalan chain fashionable Handle, one of the main rivals of Zara, add that “the prices adapt based on each market to obtain that the stores are profitable”. Although they say that the prices do not rise of random form, admit that in countries like the United States, the increase of the tariffs contributes to position the mark in a segment of certain market.
From Inditex they emphasize that, although generally the internationalization penalizes the yield of the companies, if so have been able to increase the gross margins of the group thanks to its world-wide expansion. The chain, that manages 1,532 stores in 72 countries, recognizes that the weighed prices more in the outside contribute to improve the ratios.
One of the suppliers of Inditex explains that the main factor to determine the price abroad is the margin, because “all the costs reverberate of proportional form in the prices”. “There are products that can get to become luxury once repelled all the costs”, they indicate sources of a competing fashionable chain of Inditex.
Tariffs, transport, expenses of structure and taxes are the main factors that influence in the price of an article. In countries like Russia and the United States, the labels go off by the high cost of the tariffs of the customs. In Europe, one of the main costs is the taxes, to which there are to add to the cost in the rents of the premises and the pays of the workers, more expensive in countries like the United Kingdom.
Besides the prices of the commercial premises that in Spain are of those of London or New York, the costs of transport in the products which they are sold in Spain are inferiors to those of the rest of the world. In Zara, the articles that leave the Asian factories travel to Spain to be distributed to the rest of the world, but Inditex assures that the logistic cost to the most distant point of sale (Japan) is inferior to the 1 percent. The key is its particular model, one of the great secrets of the success of the Spanish chain.